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Halla Tomasdottir, founder and chair of Audur Capital, speaking at an event in 2013. Tomasdottir ran for President in 2016, receiving the second highest number of votes in a crowded field of candidates. Though Tomasdottir did not win,...

For a country that has the same population as St. Louis, Missouri, Iceland packs an influential punch in demonstrating the power of equal pay. A Nordic country of 334,000 people, Iceland has been ranked by the World Economic Forum as the global leader on reducing gender inequality. On January 1, 2018, the country fully enacted the world's firstequal pay law. This new law requires companies with 25 or more employees to obtain certification to confirm that equal pay is a reality for all employees, regardless of gender. Companies might have up to four years to comply with the new regulations, according to the Icelandic Ministry of Welfare's official website. While the passage of this law is encouraging, it is estimated that many women in Iceland still make 14-18% less than their male counterparts.

Yet, how do Icelandic women feel about the impact of this new law? I decided to connect with them directly to get their reactions, and find out how they thought their workplaces might change. I also talked to experts from the United Kingdom and the United States to find out if Iceland's legal precedent could extend to other countries.

In both her TEDtalks, Halla Tómasdóttir mentions how growing up in Iceland inspired her to continually work towards gender equality. Starting as an underdog candidate, Tomasdottir ran for President in 2016. She got the second most votes in a crowded field of candidates, despite polls showing that she had 1% support some 45 days before election day. A year after Tómasdóttir lost her race, the percentage of women elected to the Icelandic parliament dropped from 47.6% to 38.1%. Even with this drop in representation, Iceland did go on to elect the second woman to serve as prime minister, Katrín Jakobsdóttir, at the end of 2017.

Despite the campaign loss, Tómasdóttir has a powerful track record of bringing strong and unapologetically feminine values to usually male-dominated sectors, like financial services. She views the equal pay law as a logical next step towards fully closing the gender gap, not only because it celebrates equality, but because it's good for business. Citing a study from McKinsey and Company, she noted that "the world could increase Global GDP by as much as $28 trillion by closing the gender gap in labor participation. Any leader who wants their company or country to remain competitive should be putting gender equality at the top of her or his agenda." Tómasdóttir has first-hand knowledge of keeping a company competitive during difficult times. Her firm - Audur Capital - was one of the few to survive the Icelandic economic crisis of 2008.

Ása M. Ólafsdóttir is the Senior Human Resources Manager for CCP Games, an interactive entertainment company that makes virtual reality games. When she started at CCP in 2013, the company did not have a written equal pay policy. Ólafsdóttir decided to help change that, and lead the way for CCP Games to undergo a voluntary audit. This was done in 2016, in partnership with one of Iceland's largest unions.

What's interesting is that the voluntary audit wasn't done to prevent fines, but to prove that CCP Games had always maintained equal pay. Ólafsdóttir saw a competitive value in being a certified company, as it aligned with the company's values. "It was important to me when I was a job seeker, to feel confident that I was working for a company that valued and honored equality and didn't discriminate in pay. Once I was working at CCP, I wanted everyone to know - including our current employees and potential job candidates - that CCP was an equal pay company," she said. The audit also confirmed that equal pay was maintained regardless of nationality.

Freyja Steingrímsdóttir is a Senior Consultant with Red Heart Strategies, a digital marketing firm. She sees the law as the logical continuation of Iceland's history around gender equality. “It's something that women in Iceland have worked very hard for,” Steingrímsdóttir said. Steingrímsdóttir mentioned three key historical moments, including the general women's strike in 1975 where 90% of women participated, electing Vigdís Finnbogadóttir asthe first democratically elected female president in the world in 1980, and successfully getting the women’s party voted into parliament in 1983. Steingrímsdóttir thinks that because of this history, the new law did not encounter much resistance, but Steingrímsdóttir notes that it is yet unclear how this law might be implemented across industries.

Elin Eggertsdottir is an arts and entertainment executive and Icelander living in the United States. She pointed out how the new law shifts the focus of implementing equal pay away from the employee and towards the employer. "In the United States, the dialogue on equal pay still revolves around the notion that women on average are paid less because they are not aggressive enough when it comes to negotiating salary, and therefore it is their own fault,” said Eggertsdottir. “In Iceland, the conversation has moved beyond that, and this legislation acknowledges that the responsibility to close the wage gap ultimately lies with the employer.” Eggertsdottir also noted that what works in Iceland may not scale in other countries, but she’s interested to see if other countries will try to follow suit.

In the United Kingdom, one expert I talked to was encouraged but realistic about how long it might take to close the gender gap in other countries. "Whilst the Icelandic approach will have a big impact for pay equality, it is still essential that women feel confident enough to negotiate in the workplace. Asking for what you want and deserve will impact far more than just the number on your payslip," negotiation expert Natalie Reynolds said. "Let's not forget, in the UK we have had equalities legislation that relates to pay since 1970 and we still have huge problems and discrepancies, something illustrated by the recent BBC pay scandal." Overall, Reynolds is encouraged by the implementation of the Icelandic equal pay law as it shows that action is possible.

In the United States, equal pay legislation continues to be stalled, in part because of private industry's lack of creating salary transparency. “The pay gap has been allowed to fester over these many decades at great cost to women in part because employer pay practices are shrouded in secrecy.” said Fatima Goss Graves, President and CEO of the National Women’s Law Center. “The U.S. has a lot to learn from the Iceland transparency example. It would make a world of difference to know where you stand before you even apply for a job.” Another expert noted that a true solution to closing the gap will take creative solutions from industry as well as legislative action. “I was heartened to hear the news out of Iceland, “ said Anne Hedgepeth, Vice President of Public Policy and Government Relations for the American Association of University Women. “Clearly the nation is taking the issue of pay inequality seriously and striving to find creative solutions to close the gender pay gap. The U.S. Congress could learn a thing or two.” While some US-based companies like Salesforce are leading the way of salary transparency, that corporate leadership is not yet the norm.

The further truth is that gender-based discrimination is illegal in many countries, including the United States. “The reality is that women are paid less than men in every country in the world. It’s time for the U.S. to catch up to our friends in Iceland and recognize that when women are both in power and empowered to succeed, so can the country," said Teresa C. Younger, President and CEO of the Ms Foundation. Younger mentioned that closing the pay gap in addition to addressing other economic complexities like parental leave and retirement - as they have in Iceland - are changes that could radically benefit women and families while strengthening any economy.